* Is it worth living outside zone 1 to save money on transport? * If you were to choose, where would you live?

As others have said, I don't think there's much difference between zone 1 travel and zones 1-2... unless you can rule out a travelcard altogether and walk/cycle to work. That would be the Angel advantage.

Personally, though, I wouldn't fancy it with a family. Don't know Balham, so can't comment (but agree with Emma that Blackheath is lovely and quite convenient).

If you're working in the city, don't rule out Overground links. Personally, I love West Hampstead (doable on 60k, though getting more expensive; close to the Heath and Primrose Hill; villagey in feel but a 15-minute tube journey into the West End; lots of young professionals and families; good schools, etc.) and know several people living there who commute to city jobs.

If you're working in the city, don't rule out Overground links.

And they're southwards, now, and it's transformed things, because the service is so good into that RH side of the City. Brockley and Telegraph Hill are really nice family areas, with Blackheath, Greenwich and Goldsmiths up the road, and excellent connections with the Jubilee line East and West.